By The Associated Press and DAVID KOENIG
Published: Jun. 30, 2024 at 4:15 PM CDT|Updated: Jun. 30, 2024 at 6:26 PM CDT
(AP) - The U.S. Justice Department is pushingBoeingto plead guiltyto criminal fraudin connection with two deadly plane crashes involving its 737 Max jetliners, according to several people who heard federal prosecutors detail a proposed offer Sunday.
Boeing will have until the end of the coming week to accept or reject the offer, which includes the giant aerospace company agreeing to an independent monitor who would overseeits compliancewith anti-fraud laws, they said.
The case stems from the department’s determination that Boeingviolated an agreementthat was intended to resolvea 2021 chargeof conspiracy to defraud the U.S. government. Prosecutors alleged at the time that Boeing misled regulators who approved the 737 Max and set pilot-training requirements to fly the plane. The company blamedtwo relatively low-level employeesfor the fraud.
The Justice Department toldrelatives of some of the 346 peoplewho died in the 2018 and 2019 crashes about the plea offer during a video meeting. Thefamily members, who want Boeing to face a criminal trial and to pay a $24.8 billion fine, reacted angrily. One said prosecutors were gaslighting the families; another shouted at them for several minutes when given a chance to speak.
“We are upset. They should just prosecute,” said Massachusetts resident Nadia Milleron, whose 24-year-old daughter, Samya Stumo, died in the second of two 737 Max crashes. “This is just a reworking of letting Boeing off the hook.”
Prosecutors told the families that if Boeing rejects the plea offer, the Justice Department would seek a trial in the matter, meeting participants said. Justice Department officials presented the offer to Boeing during a meeting later Sunday, according to a person familiar with the situation.
Boeing and the Justice Department declined to comment.
The plea deal would take away the ability of U.S. DistrictJudge Reed O’Connorto increase Boeing’s sentence for a conviction, and some of the families plan to ask the Texas judge to reject the deal if Boeing agrees to it.
“The underlying outrageous piece of this deal is that it doesn’t acknowledge that Boeing’s crime killed 346 people,” said Paul Cassell, one of the lawyers for victims’ families. “Boeing is not going to be held accountable for that, and they are not going to admit that that happened.”
Sanjiv Singh, a lawyer for 16 families who lost relatives in the October 2018 Lion Air crash off Indonesia, called the plea offer “extremely disappointing.” The terms, he said, “read to me like a sweetheart deal.”
Another lawyer representing families who are suing Boeing, Mark Lindquist, said he asked the head of the Justice Department’s fraud section, Glenn Leon, whether the department would add additional charges if Boeing turns down the plea deal. “He wouldn’t commit one way or another,” Lindquist said.
The meeting with crash victims’ families came weeks after prosecutors told O’Connor that the American aerospace giant breached the January 2021 deal that had protected Boeing from criminal prosecution in connection with the crashes. The second one took placeinEthiopialess than five months after the onein Indonesia.
A conviction could jeopardize Boeing’s status as a federal contractor, according to some legal experts. The company has large contracts with the Pentagonand NASA.
However, federal agencies can give waivers to companies that are convicted of felonies to keep them eligible for government contracts. Lawyers for the crash victims’ families expect that would be done for Boeing.
Boeing paid a $244 million fine as part ofthe 2021 settlementof the original fraud charge. The Justice Department is likely to seek another, similar penalty as part of the new plea offer, said a person familiar with the matter who spoke on condition of anonymity to discuss an ongoing to discuss an ongoing case.
The deal would include a monitor to oversee Boeing — but the company would put forward three nominees and have the Justice Department pick one, or ask Boeing for additional names. That provision was particularly hated by the family members on the call, participants said.
The Justice Department also gave no indication of moving to prosecute any current or former Boeing executives, another long-sought demand of the families.
Lindquist, a former prosecutor, said officials made clear duringan earlier meetingthat individuals – even CEOs – can be more sympathetic defendants than corporations. The officials pointed to the 2022 acquittal on fraud charges of Boeing’s chief technical pilot for the Max as an example.
It is unclear what impact a plea deal might have on other investigations into Boeing, including those following the blowout of a panel called a door plug from the side of a Boeing Max 9 duringan Alaska Airlines flightin January.
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